ASCENDAS HOSPITALITY TRUST 1Q FY2019 Financial Results Presentation - - PowerPoint PPT Presentation

ASCENDAS HOSPITALITY TRUST

1Q FY2019 Financial Results Presentation

1 August 2019

Disclaimer

This presentation shall be read in conjunction with A-HTRUST’s Unaudited Financial Results for the First Quarter ended 30 June 2019 (“1Q FY2019”), copies of which are available on www.sgx.com or www.a-htrust.com. This presentation may contain forward-looking statements that involve risks and uncertainties. Actual future performance,

• utcomes and results may differ materially from those expressed in forward-looking statements as a result of a number of risks,

uncertainties and assumptions. Representative examples of these factors include (without limitation) general industry and economic conditions, interest rate trends and foreign exchange rate trends, cost of capital and capital availability, competition from similar developments, shifts in expected levels of average daily room rates and occupancy, changes in

• perating expenses, including employee wages, benefits and training, property expenses and governmental and public

policy changes and the continued availability of financing in the amounts and the terms necessary to support future business. Investors are cautioned not to place undue reliance on these forward looking statements, which are based on the Managers’ current view of future events. The Australian Dollar, Japanese Yen, Korean Won and Singapore Dollar are defined herein as “AUD”, “JPY”, “KRW” and “SGD”

• r “S$”, respectively.

Any discrepancies in the figures included herein between the individual amounts and total thereof are due to rounding.

2

Content

3

• 1. Financial Review
• 2. Portfolio Performance
• 3. Capital Management
• 4. Looking Ahead

ibis Ambassador Seoul Insadong, Seoul, South Korea

• 1. Financial

Review

Results Summary – 1QFY2019

5 Financial Review

1. The current financial year end will be a 9-month period from 1 April 2019 to 31 December 2019 following the change of financial year end to 31 December. 2. Save for DPS, percentage changes are based on figures rounded to nearest thousands. 3. Gross revenue and net property income for the corresponding period last year excluded contribution from the China portfolio, which was divested on 18 May 2018. Including contribution from the China portfolio, gross revenue and NPI for 1Q FY2018/19 were S$48.2 million and S$20.2 million, respectively. 4. Retention of distributable income for 1Q FY2019 and 1Q FY2018/19 was 6.7% and 7.0% respectively. 5. Excluding the partial distribution of proceeds from the sale hotels in China.

1st Quarter S$’ million FY20191 FY2018/19 Change2

Gross Revenue3 46.5 44.9 3.5% Net Property Income3 21.3 18.7 13.6% NPI Margin (%) 45.7 41.6 4.1pp Income available for distribution 15.6 16.4 (5.1)%

• Operations

15.6 14.6 6.4%

• Proceeds from Divestment
• 1.8
• Income available for

distribution net of retention4 14.6 15.3 (4.8)% DPS (cents)4 1.28 1.35 (5.2)% Adjusted DPS (cents) 1.28 1.205 6.7%

• Full quarter contribution from all

five newly acquired hotels

• Partially offset by lower

contribution from Australia portfolio which was impacted by weaker AUD against SGD

• Excluding the partial distribution of

proceeds from the sale of hotels in China of the corresponding quarter last year, DPS would increased by 6.7% y-o-y from 1.20 cents in 1Q FY2018/19

FY2017/18 FY2018/19 FY2019 1.20 1.32 1.45 1.40 14.7 16.1 16.0 19.5 15.3 16.6 16.5 20.1 14.6 1.31 1.42 1.41 1.72 1.35 1.46 1.45 1.77 1.28 0.00 0.20 0.40 0.60 0.80 1.00 1.20 1.40 1.60 1.80 0.0 5.0 10.0 15.0 20.0 25.0 30.0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q DPS (Singapore cents) Distributable Income (S$ million) Distributable Income DPS

Distribution History

Financial Review 6 13.6 14.9 16.5 15.9

Distributable Income (excluding Proceeds from Divestment1) DPS (excluding Proceeds from Divestment1)

1. Excluding the partial distribution of proceeds from the divestment of Novotel Beijing Sanyuan and ibis Beijing Sanyuan.

Pullman and Mercure Brisbane King George Square, Brisbane, Australia

• 2. Portfolio

Performance

Performance by Country

8 Portfolio Performance 9.1 1.5 5.9 0.4 3.3 8.8 7.2 1.9 3.3 0.0 2.0 4.0 6.0 8.0 10.0 Australia China Japan Korea Singapore S$ million 34.3 3.3 6.9 0.4 3.3 32.9 8.2 2.1 3.3 0.0 10.0 20.0 30.0 40.0 Australia China Japan Korea Singapore S$ million

1Q FY18/19 1Q FY19 1Q FY18/19 1Q FY19

Gross Revenue Net Property Income

19.0% >300% 0.3% 3.9% 3.1% 22.8% >300% 0.1%

• Full-quarter contribution from all five hotels acquired in FY2018/19.
• Australia portfolio impacted by weaker AUD against SGD.

Australia 45% China 7% Japan 29% Korea 2% Singapore 16% Australia 41% Japan 34% Korea 9% Singapore 16%

Added income stability

9 Portfolio Performance

1Q FY2018/19 Net Property Income 1Q FY2019 Net Property Income

Master Leases 48% Master Leases 59% Management Contracts 52% Management Contracts 41%

• The five hotels acquired in FY2018/19 are all under master leases and have contributed on a full-quarter basis in 1Q FY2019, resulting in added

stability to the overall income of the trust.

FY17/18 FY18/19 FY19 FY17/18 FY18/19 FY19

Australia – Respite amidst headwinds

10 Portfolio Performance

0.000 0.400 0.800 1.200 0.0 2.5 5.0 7.5 10.0 12.5 15.0 17.5 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q SGD / AUD S$ million 0.0 5.0 10.0 15.0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q AUD million

Net Property Income in AUD Net Property Income in SGD

• Headwinds in Sydney and Melbourne markets resulted in RevPAR decline of 2.2% y-o-y. Despite the challenges, the performance of Pullman

Sydney Hyde Park improved on the back of stronger conference and events business during the quarter.

• Hotel in Melbourne received refund of land tax surcharge to post higher NPI, while performance of Brisbane hotel improved driven by growth

in both occupancy and average room rates.

9.0 9.2 9.1 8.8 +2.1%

• 3.1%

SGD/AUD: 0.9611 (-5%) SGD/AUD: 1.0101

1. Based on average rate used for the respective quarter.

FY17/18 FY18/19 FY19 FY17/18 FY18/19 FY19 100.0 200.0 300.0 400.0 500.0 600.0 700.0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q JPY million 0.000 0.002 0.004 0.006 0.008 0.010 0.012 0.0 2.0 4.0 6.0 8.0 10.0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q SGD / JPY S$ million

Japan – Acquisitions drive growth

11 Portfolio Performance

Net Property Income in JPY Net Property Income in SGD

• The contribution from Japan portfolio in 1Q FY2019 was boosted by full-quarter contribution from the three WBF-branded hotels acquired in

FY2018/19, as NPI grew by 22.2% y-o-y in JPY term.

• During the quarter, Hotel Sunroute Osaka Namba was rebranded as Sotetsu Grand Fresa Osaka-Namba, with no change to the terms of

master lease, as the operator seeks to market the hotel as a premium product.

482.6 589.8 5.9 7.2 +22.2% +22.8% SGD/JPY: 0.0121 (+0%) SGD/JPY: 0.0121

1. Based on average rate used for the respective quarter.

FY18/19 FY19 FY18/19 FY19 0.0000 0.0002 0.0004 0.0006 0.0008 0.0010 0.0012 0.0 0.5 1.0 1.5 2.0 2.5 1Q 2Q 3Q 4Q 1Q SGD / KRW S$ million 0.0 200.0 400.0 600.0 800.0 1,000.0 1,200.0 1,400.0 1,600.0 1,800.0 1Q 2Q 3Q 4Q 1Q KRW million

South Korea – Added income stability

12 Portfolio Performance

Net Property Income in KRW Net Property Income in SGD

• Full-quarter contribution from both The Splaisir Seoul Dongdaemun and ibis Ambassador Seoul Insadong resulted in the NPI from South Korea

improving by more than 3 times compared to the same quarter last year.

• The underlying performance of both hotels improved as RevPAR of the two hotels increased by approximately 10% y-o-y on average.

336.8 1,615.6 0.4 1.9 +>300% +>300% SGD/KRW: 0.00121 (-5%) SGD/KRW: 0.00121

1. Based on average rate used for the respective quarter.

FY17/18 FY18/19 FY19

Singapore – Master lease mitigates downside

13 Portfolio Performance

Net Property Income in SGD

1.0 2.0 3.0 4.0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q S$ million 3.3 3.3 +0.1%

• The underlying performance of the hotel was affected by lower transient and corporate business during the quarter.
• However, this was mitigated by the master lease arrangement and the contribution from the Park Hotel Clarke Quay was relatively stable

compared to the corresponding quarter last year.

Park Hotel Clarke Quay, Singapore

• 3. Capital

Management

Prudent capital management

15 Capital Management

As at 30 June 2019 As at 31 March 2019 Borrowings (S$ m) 646.8 643.6 Total Assets (S$ m) 1,909.6 1,938.4 A-HTRUST Gearing (%) 34.1 33.2

• A-HREIT Gearing (%)

35.6 35.0

• A-HBT Gearing (%)1

32.6 31.7

A-HTRUST Interest Cover (times)2 12.8 12.7 Average interest rate (%) 1.9 2.0 Weighted average debt to maturity (years) 3.5 3.8 Net asset value per stapled security (S$) 0.99 1.02

1. Does not include SFRS(I) 16 Leases accounting adjustments recorded in A-HBT’s financial statements. 2. Blended basis, computed based on earnings before interest, tax, depreciation and amortisation over interest expenses.

Balanced debt profile

16 Capital Management

Debt Profile

Fixed 82.5% Floating 17.5% AUD 27.2% SGD 0.9% JPY 61.3% KRW 10.6% Debt Currency Profile Interest Rate Profile

Balance Sheet Hedging

28% 33% 54% AUD KRW JPY

Debt Maturity Profile

150 316 37 74 66 100 200 300 400 2019 2020 2021 2022 2023 2024 S$ million Bank Loans MTN 2

▪ High proportion of borrowings in fixed rates. ▪ No significant refinancing requirements until 2020.

Pullman Sydney Hyde Park, Sydney, Australia

• 4. Looking

Ahead

Australia

18 Looking Ahead

Outlook

• Demand for hotel accommodation in Sydney is

expected to remain robust in the near term although increase in supply may place downward pressure on room rates.

• Looking ahead, the Melbourne hotel market

conditions are expected to remain soft over the medium term as new supply of hotel rooms enters the market.

• Comparatively limited upcoming supply of rooms over

the near term can help to lift the performance of the hotel market in Brisbane, which is further supported by the new runway in Brisbane Airport, scheduled to open in 2020.

Pullman Sydney Hyde Park Novotel Sydney Central

AUSTRALIA PORTFOLIO Properties: 6 Land Tenure: All freehold Number of Rooms: 1,702 Valuation: AUD638.0 million1

Pullman & Mercure Melbourne Albert Park Novotel Sydney Parramatta Pullman & Mercure Brisbane King George Square Courtyard by Marriott Sydney-North Ryde

1. As at 31 March 2019.

Japan

19 Looking Ahead

Outlook

• The hotel sector in the cities of Tokyo and Osaka are

expected to benefit from the Rugby World Cup 2019, which is expected to draw both international and domestic travellers.

• In addition, the hotel market in Tokyo will be

supported by the 2020 Olympics while a new attraction in Universal Studios Japan, slated to open in 2020, provides further boost to the hotels in Osaka.

• However, the Osaka hotel market is facing more

supply of rooms in the medium term.

JAPAN PORTFOLIO Properties: 5 Land Tenure: All freehold Number of Rooms: 2,128 Valuation: JPY57,050.0 million2

1. Formerly known as Hotel Sunroute Osaka Namba. 2. As at 31 March 2019.

Hotel WBF Kitasemba East Hotel WBF Kitasemba West Hotel WBF Honmachi Hotel Sunroute Ariake Hotel Sunroute Ariake Sotetsu Grand Fresa Osaka-Namba1 Sotetsu Grand Fresa Osaka-Namba1

South Korea

20 Looking Ahead

Outlook

• Recovering demand from China and steady

growth from other source markets have resulted in strong y-o-y growth of 16.9% in foreign arrivals into South Korea for the period YTD June 20191.

• With moderate upcoming supply in Seoul,

increase in inbound travellers is expected to continue driving the performance of the hotel market.

1. Source: Korea Tourism Organization. 2. As at 31 March 2019 and based on 100% interest in the hotels. A-HTRUST holds 98.7% and 98.8% interest in The Splaisir Seoul Dongdaemun and ibis Ambassador Seoul Insadong, respectively. The remaining interest in the hotels are held by a sponsor-related entity.

SOUTH KOREA PORTFOLIO Properties: 2 Land Tenure: All freehold Number of Rooms: 578 Valuation: KRW161,500.0 million2

The Splaisir Seoul Dongdaemun The Splaisir Seoul Dongdaemun The Splaisir Seoul Dongdaemun ibis Ambassador Seoul Insadong ibis Ambassador Seoul Insadong

Singapore

21 Looking Ahead

Outlook

• International arrivals into Singapore remained healthy with YTD May 2019 figures posting a 1.5% y-o-y

growth to 7.8 million1, and greater connectivity to Singapore via new air routes is expected to continue driving inbound arrivals.

• Amidst relatively modest supply, the growth in inbound travellers bodes well for the hotel sector in the

near term but weaker corporate demand will pose headwinds for the sector.

1. Source: Singapore Tourism Board. 2. As at 31 March 2019.

SINGAPORE PORTFOLIO Properties: 1 Land Tenure: 99 years expiring 2105 Number of Rooms: 336 Valuation: S$325.0 million2

Park Hotel Clarke Quay Park Hotel Clarke Quay Park Hotel Clarke Quay Park Hotel Clarke Quay

Thank you

Ascendas Hospitality Fund Management Pte. Ltd. Ascendas Hospitality Trust Management Pte. Ltd.

Managers of A-HTRUST 1 Fusionopolis Place, #10-10 Galaxis, Singapore 138522 Tel: +65 6774 1033 www.a-htrust.com